Halifax offers to pay stamp duty for first-time buyers
- Local People Photo Archive, Flickr
It's been a long time coming, but there have been some recent glimmers of hope for first time buyers in the property market. Halifax, one of the UK's biggest lenders, is offering to cover the costs of stamp duty on a first property purchase. This could amount to up to £2,500.
With property prices remaining high, wages stagnant and unemployment rising, getting on the property ladder remains a daunting obstacle for any buyer who can't raise a substantial deposit that can often be in five figures. The Halifax initiative is an indication that lenders are now prepared to be more competitive in order to get the property market moving again.
Craig McKinlay, a mortgage director at Halifax, said that stamp duty is a cost that can often be overlooked when potential buyers are considering properties. "We're keen to do what we can to support those buying their first home, and eliminate the additional burden of a stamp duty bill at what is already an expensive time," he said.
In effect the Halifax move merely redresses one of the drawbacks for first time buyers. From 2010 to 2012, first-time buyers were exempt from stamp duty. The addition of this tax in the last year has made buying property markedly more expensive for borrowers who have already struggled to raise a deposit.
The Government's recent Funding for Lending Scheme has encouraged lenders to be a little more bold in the range of mortgage products they offer to first-time buyers. This has increased the proportion of first-time buyers taking out mortgages.
Critics suggest that these measures are a band-aid over the main problem: inflated house prices. Until the housing bubble bursts, they suggest, George Osborne's FLS scheme and the Halifax stamp duty offer will merely shore up the unrealistic prices being asked for first-time properties.
The Halifax offer is available until July 7 2013.